Aviation industry is facing tough times: association head

Herdman made the remarks at the 52nd Assembly of Presidents of AAPA, which was hosted by Taiwan’s EVA Airways.

The AAPA, with headquarters in Kuala Lumper, is an association of 17 international airlines based in the Asia-Pacific region, including Taiwan’s China Airlines and Eva Air.

Herdman said that high oil prices in the first half of this year increased the operation costs of airline companies by 20 percent, leaving no room for profit.

Nearly all of the AAPA’s members failed to break even during that period, according to Herdman.

The next 18 months will be the toughest time for the commercial aviation industry, he forecast, adding that more airline companies might be forced to close during the industry’s bleak period.

The global aviation industry’s annual losses for 2008 is estimated to reach US$5.2 billion, Herdman said, citing a forecast by the International Air Transport Association (IATA). The IATA also estimated that the commercial aviation industry will still see losses of about US$4.1 billion for 2009, but will start showing profits by the following year, Herdman said. However, he cautioned, the IATA may have been too optimistic in its forecast.

Jeng Kung-yeun, EVA Air’s general manager, said people still need to travel by air even if the economy is bad, adding that he believes the aviation industry will recover sooner or later. Jeng also expressed the view that the planned expansion of direct cross Taiwan Strait charter flights, based on an agreement signed between Taiwan and China earlier this month, will benefit the aviation industry in the Asia Pacific region.

Under the cross strait agreement, the number of nonstop charter flights between Taiwan and China will be increased and travel time will be reduced, as the charters will be allowed to take more direct flight routes.

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